Wednesday, January 12, 2011

Blog Assignment #2 - National Debt

1. I'm sure that every adult in the US that is capable of voting would be interested in this statistic because it is something that affects all US citizens and many others around the world. Those involved with making government spending decisions would probably be particularly concerned with this statistic because they are the individuals who directly affect it. Also, those who buy and sell U.S. Treasury bonds, bills, and notes would have a particular interest in this statistic.
2. The U.S. Treasury is responsible for collecting and reporting this statistic continuously because it fluctuates both positively and negatively throughout any given day. The national debt is simply the sum of any outstanding obligations of the government at any given time and is thus fairly simple to calculate given the information that the U.S. Treasury has access to. There are many national debt clocks scattered throughout the country and some that appear online that continuously report the status of the national debt in several forms including per capita debt. The Office of Management and Budget in the White House is responsible for submitting budget proposals to congress and making budget projections for the future.
3. The current national debt is over $14 trillion ($14, 030, 789, 856, 634) now according to the U.S. Treasury. This is significantly higher than ever before in the past and has many citizens and government officials concerned. Over the past five years the debt has increased almost $5 trillion dollars but this statistic must be put into context with the business cycle. As the US is still in a recession government spending has dramatically increased over the past few years and is still increasing today. This is a logical attempt of our government to offset the drop in GDP caused by the recession and to stimulate the economy. The main reason for our inflated national debt is irresponsible fiscal policy during times of economic growth (i.e. Bush tax cuts earlier this decade). Although the debt appears to be getting out of hand, we must understand that this is due to our government currently making fairly strong fiscal decisions and that once out of this recession the debt will be dealt with with greater enthusiasm.

U.S. National Debt Clock: Real Time

Knoller, Mark. "National Debt Tops $14 trillion". CBS News: Politics.

Office of Management and Budget.

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